Give credit to New York state Senator Joe Addabbo—he’s always thinking how to tap into gambling for the betterment of his and other constituents.
His latest idea is to allocate tax revenues from iGaming to fund the financially troubled Metropolitan Transportation Authority (MTA). iGaming? Yeah. Not a law yet, just a crusade from one man at the moment.
When New York Governor Kathy Hochul proposed in her preliminary executive budget that revenue from future downstate casinos go to fund mass transit in New York City, some observers wondered if that was such a good idea.
Hochul doesn’t see any earnings from the casinos until 2026, not much help for the troubled MTA. Then there are concerns about the 80 percent of revenue generated going to education.
Addabbo told US Bets on February 21 he will expound on his proposal at a roundtable at the beginning of March. He thinks the state needs to get aggressive since New Jersey, Pennsylvania, and Connecticut already have it in place.
“I can’t go back to my people and say, `Hey, listen, we’re taking gaming money to give to the MTA,’” Addabbo said. “So, I have an alternative. If you want MTA money from gaming revenues, [these are] unspoken for because [iCasino is] a new product. You can use iGaming funds for other purposes, whether it’s health, social services, whatever, and I can get it to you quicker, maybe by next year. Not 2026. And a lot of it, too. Significant revenue.”
Addabbo introduced Senate Bill 4856 on Feb. 15. It would legalize mobile casino gambling including slots, table games, and live dealer games. It remains in Addabbo’s Gaming and Wagering Committee, going nowhere.
The bill carries a 30.5 percent tax rate and would net the state $625 million in new taxes and one-time license fees in the first year. The bill would authorize up to 20 iGaming licenses to be split among the state’s four upstate casinos, mobile sports betting operators, licensed racinos, and federally recognized tribes.
In DraftKings’ fourth-quarter earnings call, CEO Jason Robins predicted that, even if Addabbo’s bill were to pass in 2023, iGaming probably wouldn’t launch until in 2024.
Robins said the New York iGaming market will be larger than it originally projected.
New York’s eight mobile sportsbooks have huge databases of players already so the buildup time will be less than for sports betting.
“I think the cross-sell opportunity there would be enormous. We know that some of these players are going to Connecticut, to New Jersey, to Pennsylvania to do iGaming now,” Robins said. “So, I do think there is some incremental customer acquisition spend, but it’s different from a fresh market where we haven’t had hundreds of thousands of customers that we’ve acquired already.”
Addabbo says New York might be losing $1 billion per year by not having legal iGaming, because those funds are going to other states or to the illegal markets.
“I think what really needs to happen on this is the governor’s really going to have to have an appetite for this, as well as the Senate and Assembly,” Addabbo told US Bets. “It can’t just be one legislator. It has to be a collective thought.”
